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Summary for June 27- July 2, 2011:
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Monday, June 27, 2011

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Report: Maersk exercises option on 10 more containerships worth $1.85 bil

On the heels of its 10-vessel order in February worth $1.9 billion, Denmark’s Maersk has reportedly exercised its option with South Korea’s Daewoo Shipbuilding for 10 more 18,000-TEU, “Triple-E” class containerships for $1.85 billion.

The latest batch of vessels would join the Maersk fleet by May of 2015, according to a regulatory filing by Daewoo as reported by Reuters.

After the initial 10-vessel order in February, Maersk had options for 20 more such ships that the shipping giant has touted as being on the cutting edge of environmentally friendly vessel technology.

The ocean carrier has said the new mega-ships are initially destined to ply the Asia-Europe trades, where other shipping lines are beefing up as well, including Singapore’s NOL, which recently ordered ten 14,000-TEU containerships from Daewoo as well.

For the full Reuters story:

MOL orders, charters larger containerships

Mitsui O.S.K. Lines President: Koichi Muto announced the Japanese shipping group would order two 8.600-TEU containerships from Mitsubishi Heavy Industries, Ltd., with delivery slated for 2013, along with agreeing to a three-year charter for five 14,000-TEU mega-ships with Singapore’s Neptune Orient Lines.

MOL said in a statement that the new ships on order are scheduled for delivery in 2013 and would join an existing fleet of 8,100-TEU vessels on rotation in the Asia-Europe trade.

The chartered ships are due for delivery to NOL, parent to APL, between 2013-2014, and will also serve in the Asia-Europe trade where MOL is a partner in The New World Alliance.

“Expansion of the fleet will secure needed capacity on the East-West route, and allow us to provide high-quality, competitive services,” said Muto.

Jones Lang LaSalle to market logistics center in Illinois

Industrial real estate firm Jones Lang LaSalle announced it has been hired as the exclusive marketing agent for the RidgePort Logistics Center, a 1,500-acre industrial park near Joliet, Ill.

“This development responds to increased customer demand for integrated rail and logistics solutions, all within three miles of the nation’s largest inland container port,” said John Carver, head of Jones Lang LaSalle’s ports, airports and global infrastructure practice in a statement.

“It will serve as a strategic Midwest warehousing and distribution hub for years to come,” Carver said.

The RidgePort property is being developed by Ridge Property Trust, and is master-planned to include more than 20 million square feet of industrial space in buildings that range from 200,000 to 2.5 million square feet.

The property is also near the BNSF Logistics Park-Chicago in Elwood, Ill., and the Union Pacific-Joliet Intermodal Terminal in Joliet.

“With I-55 and the UP and BNSF intermodals all at an arm’s reach, the ease of access that this park provides is truly second to none,” said Keith Stauber, regional managing director for Jones Lang LaSalle.

MPA and Panama Canal renew ties

The Maryland Port Administration announced it has renewed its memorandum of understanding with the Panama Canal Authority for another five years.

The MPA said in a statement that “the goal of the MOU is to generate new business opportunities between Asia and the Port of Baltimore through the Panama Canal, as well as facilitate information sharing and exchange best practices between the two organizations.”

The agreement was signed by MPA Administrator James J. White and ACP Administrator Alberto Aleman Zubieta.

“We are very happy to renew this agreement with the Panama Canal Authority as we get closer to one of the key datelines in the history of container shipping,” said White.

“Once the Panama Canal project is completed, the largest containerships in the world will be able to transit through and bring that business to East Coast ports that have the capabilities to handle those huge ships. After our 50-foot berth is finished, Baltimore will be one of those ports,” said White.

“Working, Living in a Port City” theme for Long Beach seminar series

The Center for International Trade and Transportation at Cal State Long Beach announced it would be offering seminar series entitled: “Working, Living in a Port City,’ beginning July 5 of this year.

The CITT said in a statement that the series “is designed to provide participants with a broader perspective of the role of a port within a community, and the impact of international trade on local communities and the nation.”

According to the CITT, the series consists of three parts - Ports: Local Actors and Global Trade; Ports: Gateway to International Trade; and Careers: The Key to Success is an Education and Skilled Workforce.

The first course will be offered on July 5, with the other two following on July 12, and July 13, respectively. All courses will be held from 6:30 to 9:30 p.m. at 1000 Studebaker Road, Long Beach, Calif., 90815.

For more information, visit:; or call 562/985-2872 or e-mail


Tuesday, June 28, 2011

Top Story

L.A. -Long Beach terminal fee increase postponed to August

A “traffic mitigation fee” increase to $120 per-FEU ($60 per-TEU) from the current $100 per-FEU that had been scheduled to take effect on July 4 at marine terminals at the ports of Los Angeles and Long Beach has been postponed to August 1.

Implemented through PierPass, a not-for-profit industry-supported program launched in 2005 by the so-called West Coast MTO (marine terminal operator) Agreement, a coalition of 13 marine terminals at the two Southern California ports, the plan has been to move more freight to off-peak hours with the goal of reducing cargo-movement congestion.

The TMF was instituted with the program to help cover associated costs by levying the fee on cargo moving through the terminals during peak operating hours. The last time the fee was raised was in 2006 and according to the PierPass director; the program has been operating at a loss - $52.3 million in 2010 – the shortfall between TMF revenues and off-peak gate costs.

“By reducing operating losses for the PierPass OffPeak program, the TMF adjustment will enable terminal operators to continue operating the extra shifts that reduce congestion and air pollution in and around the ports,” said Bruce Wargo, president of PierPass.

Since 2006, hourly labor costs have increased 31 percent, according to PierPass.

“The terminals have operated the OffPeak gates at a loss since the program’s start in 2005. The shortfall between TMF revenues and OffPeak gate costs was $52.3 million in 2010,” PierPass said in a statement.

The PierPass program claims it has nearly doubled the number of operating hours per week without requiring additional infrastructure.

“Over the past six years, PierPass OffPeak gates have grown to handle approximately 55 percent of all container traffic at the ports, accommodated close to 20 million truck transactions, and greatly eased congestion on city streets and nearby freeways during daytime business hours. The TMF helps fund the nighttime and Saturday gates that make these benefits possible,” Wargo said.

UPS, Merck expand distribution agreement to global markets

Pharmaceutical giant Merck has added some of its global distribution business for its medicines and vaccines on to its current North American agreement with United Parcel Service, the two companies announced.

"This expanded agreement with UPS allows us to focus on our core business as a global healthcare leader that looks for innovative ways to bring our medicines and vaccines to patients in emerging markets and markets around the world," said Willie A. Deese, executive vice president and president, Merck Manufacturing.

Merck’s logistics business with UPS was launched in 2003 with package transportation and delivery services in the U.S.

The agreement has since expanded to include North American distribution, warehousing and multi-modal transportation services, the companies said.

UPS will provide these types of services in select markets in Asia and Latin America, including China and Brazil, the companies said. UPS is also providing transportation services in Europe.

Asian demand drives banner year for U.S. beef exports

The best year ever for U.S. beef exports could reportedly materialize in 2011 thanks in large part to increased demand from Asia.

Overseas shipments of U.S. beef are projected to increase by 17 percent to 2.68 billion pounds this year, besting the previous record in 2003, according to CattleFax, as reported by Bloomberg.

In a year of U.S. droughts and floods impacting agricultural production along with softened domestic demand, Asian countries are more than taking up the slack, such as South Korea more than doubling its purchase of American beef for the first five months of this year due to it a foot-and-mouth virus that broke out there. “We wouldn’t have had the record-high prices without the very robust export markets,” said Jim Robb, director of the Livestock Marketing Information Center in Denver, in the Bloomberg report.

For the full Bloomberg story:

Shanghai port forecasts 10 percent volume growth for next five years

The operator of the world-leading Port of Shanghai predicts its container-shipping volume should grow by approximately 10 percent for each of the next five years as manufacturing expands inland and to the west in China.

The Yangtze River Delta "will continue to be the main region driving china's economic expansion," said Chen Xuyuan, president of Shanghai International Port (Group) in a Bloomberg interview.

The Yangtze River transportation system handled 1.34 billion tons of cargo in 2009, more than three times 2000's volumes, according to the Chinese government, and constitutes roughly 80 percent of China’s river freight.

The Port of Shanghai handled 12.7 million TEUs for the first five months of this year, compared with 12.1 million TEUs by Singapore, the former top container port in the world before Shanghai surpassed it in 2010.

For the full Bloomberg story:

Report: Somalia releases foreigners who smuggled in $3.6 mil for ransom

Somalia recently freed six foreigners who had been convicted of smuggling $3.6 million into the African country in order to pay ransoms to free ships and hostages from the clutches of pirates, according to several news reports.

Three British citizens, an American and two Kenyans were reportedly sentenced to between 10 and 15 years for the alleged smuggling, after they were arrested in Somalia on May 24 after they flew two planes into the country illegally and were subsequently fined $50,000.

The planes have since been released and Somalia’s government has seized the $3.6 million.

For the full Global Post story:

Thursday, June 30, 2011

Top Story

EU: Global maritime emissions deal not happening; regional alternative discussed

Officials with the European Union don't believe a global deal on reducing carbon emissions from maritime transport is currently doable, while they are touting a plan put forth by the Bahamas to regulate such emissions on a regional basis.

"We have nothing in the global [talks] and it is unrealistic to expect a MBM [Market-Based Measure] deal this year, next year, the year after, and maybe the year after that also," a senior EU source told EurActiv.

"On the other hand we have a political commitment to do something regionally if nothing happens globally," the source said.

The EU's flagging unilateral plans to cut shipping emissions have included enacting an emissions trading if a global treaty could not be reached.

However, China, for example, has balked at being regulated by an international scheme, so eyes are now on the International Maritime Organization's Maritime Environment Protection meeting in July where there have been calls for that group to adopt an energy efficient design index.

"Much as we prefer a global solution, the member states and the European Parliament have asked the Commission to present a possible proposal to reduce shipping emissions for 2012 in the case the IMO fails to find a solution," said Connie Hedegaard, commissioner of the EU's Climate Action Commission in a statement.

The Bahamas' proposal will reportedly be on the agenda at the IMO meeting, where instead of a global treaty, there would be a technical memorandum of understanding that regulates ships' emissions efficiency under the auspices of the IMO and enforced regionally.

The EU's member states have adopted a goal of reducing all emissions 20 percent by 2020.

For the full EurActive story:

U.S. - China business group lauds PRC removal of innovation, procurement regulations

This week's decision by China's Ministry of Finance that it would void three regulations linked to domestic innovation and government procurement policies, effective July 1, brought a stamp of approval by the U.S. China Business Council.

"Though the measures represent only a portion of the full list of regulations that tie indigenous innovation and government procurement, the elimination of these measures is an important step toward fulfilling pledges made by PRC leaders during President Hu Jintao's January 2011 visit to the United States and the May 2011 Strategic and Economic Dialogue," said USCBC President John Frisbie in a statement.

The three measures were passed in 2007, and according to Frisbie "comprise an important part of the framework of PRC preferences and policies that promote government procurement of so-called 'indigenous innovation' products."

"The MOF notice is directed to all central- and local-government agencies--an important development given that companies encounter indigenous innovation policies and barriers to sales at multiple PRC government levels," Frisbie said.

New appointments for Maersk Line North America

Charlotte-based Maersk Line North America has announced it has named Gordon Dorsey as vice president of global contract execution for U.S. military and government cargo services, and Craig Mygatt as the new regional manager of North American inland operations.

Dorsey joined Maersk in 2004 and most recently was the North American inland operation, while Mygatt started with Maersk in 1989, and has been senior director of North America trade and marketing.

Dorsey will be based in Arlington, Virginia and Mygatt will operate out of Charlotte, North Carolina, Maersk said in a statement. Both gentlemen begin their new jobs on July 1.

WWL makes two new senior appointments

Wallenius Wilhelmsen Logistics announced Christopher Connor has been named chief commercial officer for the shipping line's global organization, and Raymond Fitzgerald has been named president of WWL Americas.

The Oslo-based company said Connor would now work closely with Chief Executive Arild Iversen on global strategy and commercial development, while Fitzgerald will be based at WWL Americas' headquarters in Woodcliff, New Jersey.

Connor had president of WWL's Americas group and Fitzgerald was most recently president and CEO of American Roll-on Roll-off Carrier, an affiliated group company in the U.S.-flagged shipping sector.

Southeastern Freight Lines awarded LTL carrier of year by BASF

Regional less-than-truckload carrier Southeastern Freight Lines announced it was awarded the BASF 2010 LTL Carrier of the Year Award.

The trucking company said in a statement that it delivered 20,000 shipments for chemical company BASF.

Shipowners scrap capesize ships in record time, numbers

Capesize vessels are being scrapped at an all-time pace in the wake of a 50-percent plunge in rates over the past year.

To date, 48 capesize ships that are typically used to haul coal and iron ore, have been scrapped over the past year, compared to just 18 such vessel scraps for the previous year, according to a Bloomberg report.

According to shipbroker Clarkson Plc, rates will stay below $11,000 a day for the remainder of 2011, where the breakeven is approximately $23,000, according to Johnson Leung, head of regional transport at Jefferies Group Inc. in Hong Kong.

The unusually high volume of scraps has reportedly not been a boost to capesize rates due to 117 new such-vessels having been launched this year as there had been projections of a big increase for coal and iron ore shipments to China.

However, China's has tempered its commodity imports to cool concerns over its economy overheating, according to the Bloomberg report.

For the full Bloomberg story:

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